Calgary, Alta.-based Pieridae Energy is gearing up to build a massive, multi-billion-dollar liquefied natural gas (LNG) processing facility near the small community of Goldboro in Guysborough County, Nova Scotia, about 250 kilometres northeast of Halifax.
Construction of a $720-million workcamp and amenities at the site could begin this summer if all goes according to plan. The plant is being built on a 266-acre project site at the mouth of the Maritimes Northeast Pipeline.
The Goldboro LNG plant would take four years to build and be the largest project in Nova Scotia’s history, putting 3,500 men and women to work during construction and creating 280 permanent jobs once the facility is up and running.
Mark Brown, vice-president, business development at Pieridae, confirmed plans for the project, which has been in the works for years, are moving ahead and the company is pleased with the way it’s proceeding.
The site has been cleared, he noted, and Pieridae has signed a services agreement with global engineering firm Bechtel to deliver a comprehensive engineering, procurement, construction and commissioning (EPCC) execution plan by March 31 and a final lump sum, turnkey price proposal by May 31.
Goldboro LNG is a shovel-worthy and shovel-ready project that will create thousands of jobs,
— Alfred Sorensen
“Bechtel is completing the open book estimate for a lump sum turnkey EPCC contract,” and the company is looking to complete its work by the second quarter of 2021, he wrote in an email to the Daily Commercial News.
On its website, Natural Resources Canada has the project pegged at $8.3 billion, which would make it the most expensive of three LNG import or export facilities proposed for Nova Scotia. Detailed design and costs for the plant should be known by spring. Commercial operations are expected to start in late 2025 or early 2026.
Pieridae CEO Alfred Sorensen says the decision to have Bechtel come up with a plan is a very positive step forward for the project, as the company has significant experience building and delivering global LNG projects.
“Goldboro LNG is a shovel-worthy and shovel-ready project that will create thousands of jobs and help put Canadians back to work in a COVID-impacted environment, provide real, enduring and tangible economic benefits for First Nations, help lower global emissions by supplying LNG overseas to replace coal, and increase Europe’s choices in sourcing natural gas,” he said.
Bechtel’s oil, gas and chemicals president Paul Marsden said the company is honoured to partner with Pieridae to deliver a cleaner energy future.
“We bring a long history of successfully delivering projects in Canada and partnering with our global customers to expand access to this energy source. Together with Pieridae, we look forward to successfully bringing this project and its economic benefits to the Goldboro region.”
Pieridae has been pressing ahead on the project and in the fall awarded a contract for construction of the workcamp to house about 5,000 workers who will build the plant, to Black Diamond Group of Calgary. Units in the workcamps would be single-occupancy bedrooms with private baths.
Under the agreement, Black Diamond was directed to conduct meaningful engagement with the Nova Scotia Mi’kmaq First Nations, which would result in Mi’kmaq companies being hired to provide catering and cleaning services at the camp. Black Diamond will be responsible for the supply and rental of the work camp.
Pieridae indicated in corporate guidance for 2021 released recently that it has allocated $10 to $15 million for development expenses in 2021 and a further $250-to-$300 million capital expenditure budget that would be triggered if a final investment decision is declared by the end of June to proceed with the project.
The expenditures would be for early works at the LNG site such as highway realignment around the project, a down payment for construction of the large-scale workforce lodge, building key marine facilities for LNG offloading, and site preparation for areas to store equipment and building materials.
According to Brown, the plant is being built in Nova Scotia because it is a superb location for shipping LNG to markets mostly in Europe. Goldboro is half the distance to Europe and closer to South America and South Asia (via the Suez Canal) compared to ships coming from the U.S. Gulf Coast and Qatar.
The plant will have two liquefaction facilities, also known as trains, producing a total of about 10 million tonnes of liquefied natural gas each year, along with two storage tanks, two loading berths, a power plant, and several administration, control and maintenance facilities and utilities to support the project.
Production from the first train has been sold to German utility Uniper Global Commodities It’s a 20-year binding contract with a 10-year extension. Uniper wants to ease its reliance on supply of LNG from Russia. Germany has plans to end coal-fired power generation by 2038 and will be turning to natural gas.
The National Energy Board and U.S. Department of Energy has granted Pieridae 20-year licences to import natural gas from the United States and export it as LNG from the Goldboro facility.
As part of a commitment to fair labour practices, Pieridae has signed a project special needs collective agreement which encompasses 15 trade unions in Nova Scotia.